E-Commerce

AT&T revamps data plan pricing, adds iPhone tethering

AT&T revamped its data plan pricing structure in a move that could force rivals to follow. Unlimited plans are gone, but most customers should make out on the deal.

This is a guest post from Larry Dignan of TechRepublic’s sister site ZDNet. You can follow Larry on his ZDNet blog Between the Lines, or subscribe to the RSS feed.

AT&T on Wednesday carried out sweeping changes to its data plan pricing structure in a move that could force rivals to follow.

AT&T's move (statement) comes as analysts come around to the realization that the U.S. wireless subscriber market is saturated. The game is to keep the subscribers you have happy and that means better pricing and long-awaited perks like tethering.

Among the major changes from AT&T:

  • An entry data plan for $15 a month capped at 200 MB of data. AT&T says 65 percent of its users could get by with the $15 a month plan and cut their costs in half. Should you exceed your 200 MB cap then you get another 200 MB for $15.
  • A plan for $25 a month for 2 GB of data. This "DataPro" plan allows for an extra 1 GB of data for $10 should you go over the cap. AT&T said that 98 percent of its customers use less than 2 GB of data a month. That cap is hard to top.
  • Tethering will arrive on the iPhone and any other smartphone for $20 a month on top of a DataPro plan. Generally speaking, this set-up means a 2 GB plan with tethering for $45 a month total.
  • iPad customers will see their $29.99 unlimited plan replaced with the $25 a month DataPro plan. You still prepay without a contract.

As noted by Engadget most customers will make out on the new pricing model, which will be effective June 7. Some folks are mourning the passing of unlimited data plans, but frankly they were a bit academic. It's hard to surpass the targets the wireless carriers are setting and even if you do pass the caps, the charges are predictable.

Bottom line: Consumers aren't going to sweat unlimited plans if they can save a few bucks every month.

There's also a simplicity message here. AT&T's pricing is easier to follow now relative to what was there before even though service caps have a lower tier. Consider the new AT&T pricing compared to this mess:

Click the image to enlarge.

It should be interesting to see what rivals come back with.

Related:

11 comments
glengiancola
glengiancola

Hey Twilight23 what do you mean only 20, that is on top of 25 and that is on top of an expensive phone plan. Corporate greed is smacking your behind with a paddle and you are saying thank you may I have another. It's too much money.

Twilight23
Twilight23

If you read what I said, only was in quotes with a frown after the statement and it was blasting AT&T for charging *anything* on top of the data plan for tethering. AT&T's phone and data plan pricing are very competitive with other US carriers. Of course they're all overpriced but we can't exactly save money by getting a European plan (the international roaming would be far more expensive). My only complaint with AT&T's phone plans is that you can't get fewer than 450 minutes/month on a plan with decent features (I usually only use about 30-60 minutes a month with a "heavy" month being 120-180 minutes so I have something like 4000 rollover minutes they know I'll never use).

jmarkovic32
jmarkovic32

But if AT&T doesn't make network improvements, no one is going to take the plunge.

Twilight23
Twilight23

I keep hearing this argument but I've had AT&T since it was the original version of Cingular. I almost never lose phone coverage (and since it is GSM, it's limited to just AT&T and T-Mobile towers). I've now had an iPhone for over a year. I rarely lose 3G and almost never lose EDGE service (technically, EDGE is 3G but it is much slower). Verizon's maps may have stood up in court but they are still garbage - I regularly drive long distances and definitely have 3G service in areas that Verizon claims AT&T doesn't have any.

bdskp
bdskp

The wireless market might be saturated and that might even be part of why ATT made the changes. I think though the main reason is because we are right on the verge of a massive wireless data explosion. http://blogs.wsj.com/digits/2010/06/02/cisco-says-data-traffic-from-video-will-eclipse-file-sharing/ "To keep the growth in perspective, Cisco notes that the 100-exabyte increase it projects from 2013 to 2014 is 10 times greater than all traffic traversing Internet-protocol networks in 2008" And it's starting right now. Where do you think people are going to start watching these videos/media more and more with phones like the Incredible, the Evo and the new Iphone? That's right..on their mobile devices. Many times over 3g/4g/LTE. ATT is just preparing for the future. Their network is already overloaded because of the Iphone. They are either going to limit high data usage with overage fees or they are going to make a lot of money from data hungry people. Verizon has already said they foresee the demise of "unlimited" data plans and it's exactly because of this reason. A 2GB cap on data usage per month is fine for most people right now. Give it 2 years(specially with 4g/LTE being more widespread)..watch people explode way past that with normal usage. Smart phones with powerful cpus/gpus and tablets with even more powerful chips are going to facilitate this growth in media. To me..this is a turning point in the technology world. Just my 2 cents

Twilight23
Twilight23

I was really hoping with the revision in data plans that AT&T would include tethering for free. AT&T is the *only* iPhone carrier in the *world* that charges extra for tethering. :( With the removal of unlimited data plans, there is *no* reason to charge extra for tethering (other than to milk extra profit from customers).

The 'G-Man.'
The 'G-Man.'

you can do this out the box with any Android Phone.

Twilight23
Twilight23

You can do it with an iPhone as well but AT&T blocks it (unless you pay them the extra $20/month). If you live anywhere else in the world, you can do it out of the box for free (as long as you have a data plan). If you jailbreak the phone, you can do it in the US (or could a year ago - no idea if Apple/AT&T have managed to block this since).

The 'G-Man.'
The 'G-Man.'

Want to watch the media on my 50 inch wide screen HDTV thanks all the same. Will listen to media on the mobile however.

bdskp
bdskp

But I don't have a 50" TV here at work. On my lunch break I can catch up on anything on my DVR. Just as an example. Obviously..when you are at home you'd want to watch media on the best screen you've got. But when you aren't home..what are people going to have to watch this media? Smart phones.